Connecting the Dots in US International Taxation

August 2002 | ,

Several international taxation problems are currently receiving considerable discussion in the U.S. Congress and in the tax literature:

  • What should be done about the emigration of U.S. parent corporations to foreign jurisdictions?(Also known as corporation inversions or expatriations.)
  • Should subpart F be made more effective?
  • Can there be a replacement for the extraterritorial income regime, declared by the WTO to be a prohibited export subsidy for U.S. products?

These three problems are interrelated and, in the case of the first two, raise fundamental issues about the soundness of the U.S. rules for international taxation.4 Recent discussion, however, has not given adequate consideration to other serious problems and has ignored the potentially best solution, discussed herein.



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